FT News Briefing

Federal Reserve eyes 2022 rate rise

Sep 23, 2021
The Federal Reserve hints at tapering its bond-buying stimulus and potential interest rate hikes by 2022, sparking market discussions. Japan's SoftBank backs a new $2.5 billion private equity fund led by Steven Mnuchin, just months after his tenure. Meanwhile, China’s Evergrande property crisis reveals critical flaws in its growth strategy, exposing millions of unsold apartments and financial strains on local governments. This situation raises questions about global economic stability and geopolitical dynamics.
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INSIGHT

Federal Reserve Policy Shift

  • The Federal Reserve signaled its readiness to slow its $120 billion monthly asset purchases.
  • They are also contemplating interest rate increases starting next year.
INSIGHT

Market Reaction to Fed Announcement

  • Despite news of potential rate increases, markets remained calm, with the S&P up nearly 1%.
  • This calm reaction is attributed to the Fed's prior signaling and market adjustment to a more hawkish stance.
ANECDOTE

SoftBank's Investment

  • SoftBank invested in Steven Mnuchin's new $2.5 billion private equity fund, Liberty Strategic Capital.
  • This follows investments from Saudi Arabia's Public Investment Fund, influenced by Crown Prince Mohammed bin Salman.
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